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June 20, 1995


Before The Entire Bench (except Weaver, J.). Chief Justice James H. Brickley, Justices Charles L. Levin, Michael F. Cavanagh, Patricia J. Boyle, Dorothy Comstock Riley, Conrad L. Mallett, Jr., Elizabeth A. Weaver

The opinion of the court was delivered by: Levin



The question presented is whether the Worker's Compensation Appellate Commission erred in dismissing the employer's appeal for failure to pay medical benefits during the appeal. We hold that the WCAC did not err, and affirm the decision of the Court of Appeals *fn1 affirming the dismissal by the WCAC.


The magistrate found that Mary Garcia was totally disabled and awarded worker's compensation benefits to be paid by defendant McCord Gasket Corporation. *fn2 The order *fn3 provided that benefits were to be paid until the further order of the bureau, and that McCord shall also be "responsible for medical expenses pursuant to Section 315 *fn4 as follows: Any and all reasonable and necessary medical expenses related to plaintiff's back et sequelae."


As stated by the Court of Appeals, "numerous disputes relating to the reasonableness and necessityof various medical treatments followed." *fn5 A year after the award was entered in January, 1990, a "petition to stop benefits" was filed by McCord on January 8, 1991. A month later, on February 5, 1991, Garcia moved for dismissal of McCord's appeal to the WCAC from the magistrate's decision asserting that McCord had "refused and denied payment of medical benefits required by the terms of the award" *fn6 contrary to § 862(2), which provides that the filing of a claim for review of a magistrate's decision "shall not operate as a stay of providing medical benefits" awarded by the magistrate, and that medical benefits shall be paid from and after the date of the award until final determination of the appeal. *fn7

McCord responded to Garcia's motion to dismiss, stating that it had "considered all requests for payment of medical benefits and [had] paid those which were reasonable and necessary in accordance" with the magistrate's decision, and had "denied payment on other requests which are not reasonable or necessary . . . ." *fn8 McCord did not specify which "requests for payment" had been paid, and which had been denied, nor did it specify why a particular request was not reasonable or necessary.

McCord asserted that § 862(2) provides only for furnishing medical benefits "required by the terms of the award," *fn9 that the magistrate's award in the instant case "does not provide the terms by which medical benefits would be required," and that the award provided "no guidance" concerning "which medical providers and care and treatment [were] necessary or which amount was reasonable." *fn10


The WCAC, on June 20, 1991, ordered McCord toprovide it within thirty days "an affirmation of the bills that have been received, the date the medical services were provided, and a showing that the bills have been paid pursuant to the magistrate's order of January 22, 1989, awarding reasonable and necessary medical expenses related to plaintiff's back. Failure to provide timely compliance with MCL 418.862(2) shall subject defendants' appeal to dismissal." (Emphasis added.)

McCord did not provide the affirmation of bills received and dates medical services were provided, and did not show that such bills had been paid. Rather, McCord responded on July 17, 1991, to the WCAC order by filing a motion to remand and consolidate or hold in abeyance, stating that disputes had arisen concerning the portion of the award requiring payment of reasonable and necessary medical expenses, and stating:

What expenses or treatment are "reasonable and necessary" were not spelled out in the Magistrate's decision and, therefore, has [sic] been a matter of differing interpretation. Defendant submits that it has paid all "reasonable and necessary" expenses since the date of the Magistrate's decision.

McCord's motion noted that a hearing was scheduled for July 31, 1991, on its application for a hearing objecting to the reasonableness and necessity of the medical expenses being claimed by Garcia. The motion continued that § 315 *fn11 provides that all fees and charges for treatment were subject to the health care services rules, that those rules provide for resolving disputes between carriers and health care providers, *fn12 and that rule 1904(6), *fn13 concerning the continuation of medicalbenefits during an appeal, provides for expedited treatment accorded to sixty-day cases when a carrier files an application to stop or limit its liability. *fn14

The WCAC, on August 30, 1991, denied the motion for remand and consolidation or to hold in abeyance, and granted Garcia's motion to dismiss the appeal for failure to comply with § 862(2) and the WCAC's order of June 20, 1991. *fn15


The Court of Appeals affirmed the dismissal, holding that the WCAC has the implied authority to dismiss for noncompliance with § 862(2), citing this Court's decision in McAvoy v H B Sherman Co, 401 Mich 419; 258 N.W.2d 414 (1977). *fn16

The majority said that when McCord "refused to pay the medical bills as required" by the magistrate's and WCAC's orders, it subjected itself "to the possibility of a dismissal as stated in the commission's order." *fn17

One of the Judges on the panel Dissented. He said that if the only question presented was whether the WCAC, "under its implied power to enforce § 862(2)," could properly dismiss an appeal by an employer who ignores a magistrate's order requiring payment of medical benefits, he would join in the majority. He Dissented because § 315 contemplates that the employer's insurance carrier will "monitor closely medical treatment for injured workers with an eye to ...

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